An earlier post referred to SK and Hynix refusing to pay up front KEPCO’s 5 year electricity bill and interpreted it as a refusal to expand production and skepticism towards future demand.
That is a completely wrong interpretation of what is going on - I am sorry but if you want to discuss another country’s economic plan, you should at least learn to read past the headline. I know this is a half shitposting sub but still.
The fact is, current Korean administration (liberal / left leaning party) wants to place the new fab buildout in the southwest corner of South Korea, which has historically been a liberal stronghold. It is also one of the most underdeveloped region of S. Korea.
The current admin wants to score political points in their home turf as well as to also push for ‘equal development’ across the peninsula, relieving pressure on the capital, where half the nation’s population is crammed into.
SK and Samsung were (likely) strongarmed into agreeing to this development plan when they announced it a couple months ago.
SK and Samsung does not want to do that - planning a massive buildout from ground up in a region where there is practically nothing - is a capital and time intensive venture. Also, nobody would want to move there - most Korean tech talents want to live in a greater Seoul area. It is not uncommon to see employees pack up and jump ship when they are dispatched to branch offices out of Seoul. It’s like taking employees from NY or SF and telling them to move to a new office in Oklahoma or Missouri - companies will lose out on talent.
SK and Samsung has been expanding their production capacities but mostly just outside the Greater Seoul Metropolitan area within commuting distance with possible spillovers into Chungcheong province, a couple hours south of Seoul.
So yes, the consensus amongst S Korea is that SK and Samsung wants to expand capacity, but not in the southwest region of Korea. They have been looking more into GSA or the United States. They don’t want to commit 18 billion dollars into a power grid buildout in a region they do not want to be locked into.
So yes, the refusal to pay the bills up front say little about how SK and Samsung is anticipating future product demand - it is more about logistics and talent acquisition issue as well as domestic political pressure.